WASHINGTON, Feb 24: The Bush administration is increasing financial assistance to Pakistan and during the next fiscal year it has proposed a package of $701 million for the country, US and diplomatic sources told Dawn on Tuesday.

The proposed package, which will now be presented before Congress, is $101 million more than what the United States had agreed to give under the Camp David agreement between President George W. Bush and President Pervez Musharraf.

The raise is bound to annoy the powerful Indian lobbies in the US capital who have been constantly campaigning to curb financial assistance to Pakistan ever since Mr Bush announced the $3 billion package during Gen Musharraf's visit to Camp David two years ago.

On the Hill, the Indian lobby is led by such powerful and vocal Congressmen as Democrats Frank Pallone of New Jersey and Gary Ackerman of New York. The most vocal supporter of India on the Hill is Congressman Eni Faleomavaega.

Although he represents the small US protectorate of Samoa and does not even have full voting rights, Mr Faleomavaega bitterly opposes any proposal that even remotely favours Pakistan.

Last year, he successfully attached a condition to the Camp David aid package which now requires US president to certify every year that Pakistan is effectively playing its role in the fight against terrorism and is no more sending militants into Indian-held Kashmir.

Despite such opposition, Congress approved earlier this month the $390 million aid package for Pakistan for the current fiscal, which ends in October. The next fiscal year will cover October 2004 to October 2005.

The proposed package of $701.150 million for the next year is the highest ever for Pakistan. Even during the Afghan war Pakistan did not get such a large financial assistance in a single year. However, the Indian lobby is expected to resist the passage of the proposed assistance.